The winds of change are blowing, yet it’s a fetid and tepid wind incapable of even pushing a leaf across a barren parking lot.
Ben Bernake’s reign of money printing, inflation and quantitative easing is finally coming to an end, which, by itself, is good news. The Keynesian Kumquat (a nickname I wish I had thought of sooner) reaches his term limit in January and a new era of Fed fracas is ready to begin. The bad news is that his successor looks to be Janet Yellen, a close ally of Bernake formed in the same mold, only missing a Y chromosome.
Monetary policy will stay essentially the same, but at least everyone can celebrate how Janet is the first female Chair of the Federal Reserve. Yippee for all of humanity. Here’s a bit of Yellen’s background from NBCnews:
Yellen was appointed vice chair in October 2010. She was president and CEO of the Federal Reserve Bank of San Francisco from 2004 to 2010 and also served as chair of the Council of Economic Advisors from 1997 to 1999. Prior to joining the Fed, Yellen spent much of her career as a professor at the University of California at Berkeley, where she had been teaching since 1980.
If I wrote a parody bio for my imaginary “worst possible candidate to run the Fed” that would more or less be it. Uncanny.
Yellen, 67, would likely continue steering Fed policy in the same direction as Bernanke. A close ally of the chairman, she has been a key architect of the Fed’s efforts under Bernanke to keep interest rates near record lows to support the economy.
As vice chair, Yellen has helped manage both the Fed’s traditional tool of short-term rates and the unconventional programs it launched to help sustain the economy after the financial crisis erupted in 2008. These include the Fed’s monthly bond purchases and its guidance to investors about the likely direction of rates.
In a nutshell, everything libertarians and those with the Austrian Economic view abhor, Yellen is for. It’s a brand new world that talks, acts and even somewhat looks like the old one. The central planning and monetary expansion will remain.
All hail your new Money Printing Princess!